The Redmond giant set itself an impossible task today: make the case for a new piece of gaming hardware to hardcore gamers, the cynical gamer press, and a general consumer base that–at best–is barely recovering from the longest economic recession in decades.

There is already much gnashing of teeth amongst gamers and gaming pundits on Twitter about the lack of games revealed, and even the order in which they were shown.

Which is just this side of ridiculous.

If one wants to adopt the "hardcore/insider" stance than one has to acknowledge that Microsoft executives tipped their hand yesterday that the game reveals would be held until E3.

Even then they still brought out one of their biggest franchises–the car racing series Forza–and showed a new transmedia extension for Halo in the form of a live action television series that is going to be produced by Steven Spielberg. (More on that in a moment.)

That these were not the first announcement out of the gate ticked off some gamers and members of the press. This underestimates the challenge that Microsoft faces: this is a mobile world that we now live in, and they're attempting to sell us all a big chunk of electronics that sits in the middle of the living room.

The case had to be made that a living room based entertainment experience was going to be as valuable–if not more valuable–than the purchase of a gaming laptop or a tablet device. All things that a dedicated gamer can do right now and have an excellent gaming experience with, often times a more innovative one than what consoles allow for.

Long ago Microsoft telegraphed their intent to make the XBox the center of the living room. A device not just for games, but for communication and other forms of entertainment.

The gesture and voice controls they revealed today show that they have made massive strides in getting the user experience for those products right. That is, if those actually were live demos. The question remains: will this kind of seamless entertainment hub experience be compelling enough for mainstream consumers?

The game experiences that Microsoft billboarded today were mostly aimed at the big money targets: Forza, EA Sports, and Call of Duty. While gamers like to call themselves "core" if they are dedicated video game enthusiasts, willing to tackle a wide range of play challenges, the market tells a different story. As someone who identifies himself as a gamer, a person who can get as almost much joy out of Candy Box! as he does out of Halo or Pac-Man I empathize… but this is a business. These are the games that sell and if they were left out of the discussion there would be even shriller cries for blood.

All of this means that the stakes for E3 have gotten even higher. Both Sony and Microsoft made cases for their new consoles, but neither sealed the deal in the hearts of the press and the peanut gallery. That this will be the first console generation in ages where two technological behemoths battle it out in the marketplace with Christmas launches makes the drama even more intense.

Yet what I find most striking today is the strategy that Microsoft revealed. They seem hell bent on obliterating the line between video games and video experiences. Spielberg and Halo. A partnership with the NFL. Fantasy stats on live ESPN games. Whatever the hell that Quantum Break game is from Remedy. (Full Motion Video and games? Should I be checking the calendar?)

Putting Nancy Tellem on stage today to talk about the television content that Microsoft is developing was a massive sign for those who could read it. Tellem's mentioning of her history with CBS and Warner Bros wasn't idle name dropping. She was the president of CBS Television Studios, one of the most powerful TV executives you've never bothered to pay attention to. This is a play on par with Netflix getting into the series business with David Fincher and Arrested Development's Mitch Hurwitz. Tellem can deliver quality mainstream content.

I say this as someone who derives almost no joy from the CBS lineup. However I know that I stand in the minority of television viewing households there.

On Halo and Spielberg

Spielberg may have a less than stellar track record when it comes to producing television, but the gritty action meets space opera style of Halo is a perfect match. If Halo: Forward Unto Dawn is the template for the live action series Microsoft is looking to produce I'm going to be very, very happy.

Innovation: Where Is It?

There's still a deep question at the level of play–which is at the heart of gaming–where is the play innovation?

Sony didn't answer this question either, and Nintendo failed to make it's case with the WiiU.

The most interesting immersive experiences are happening in the indie game space and in the hands of developers who are working with technology like the Occulus Rift.

I'd be concerned, but we've seen this kind of fracturing of the video game world before. In the 90's the most interesting and innovative development was happening in the PC space, as the graphics and physics engines developed at a breakneck pace that the console manufacturers could not keep up with.

The console then became the entry level portal for gaming as a hobby. This is a space now taken up by phones and tablets. This new generation of consoles will exist as mass entertainment, but will likely cede the crazy innovative play design to the indies and companies like Valve that are willing to take bigger risks.

In some ways this is, sadly, what victory looks like for video games as an industry. Games have won the coveted position of being the most valuable part of the entertainment landscape. Which means there is more to lose than there is to gain for the big players in the market.

There's plenty to gain for those who are willing to play the role of spoilers and disruptors.